Pound Steadies After Weakening Against the Dollar as EU Gets Set to Grant Another Brexit Extension
Arslan Butt • 1 min read
The Pound is edging slightly higher against the US dollar after weakening at the end of the previous trading week as markets expect the EU to grant yet another extension to Britain on the Brexit deadline. At the time of writing, GBP/USD is trading around 1.282.
According to latest news reports, the EU is most likely going to grant an extension on Brexit until January 31, 2020, with an option to leave sooner if it able to ratify to Brexit deal before this deadline. The EU is expected to announce its decision today, even though France has opposed granting Britain any more time to get its act together on its departure from the Union.
A leaked draft of the paper reveals that Britain is set to get time until January 31 but can leave as soon as the first day of the month after it ratifies a Brexit deal. The EU’s latest proposal is also supposed to eliminate any possibility of a no-deal Brexit scenario, which should come as a huge relief to the opposition parties, especially Jeremy Corbyn’s Labour Party.
Meanwhile, the possibility of early general elections as suggested by PM Boris Johnson could very well diminish under the motion of the Fixed-term Parliament Act (FTPA), which insists on at least a two-thirds majority among MPs to call for elections. As long as the opposition Labour Party continues to hold out, general elections prior to Brexit seem unlikely.